Atlassian Launches Non-Cloud Version of HipChat

Atlassian, the Australia-based company behind the popular work collaboration tool HipChat, today launched a version of that software that runs not in the cloud but on a customer’s internal systems.

In a break from the conventional wisdom that all important business software is shifting to the cloud, Atlassian is taking HipChat behind the firewall for companies that, for whatever reason, can’t or won’t use software in the cloud.

Typically, running software in the cloud is a no-brainer for companies because the costs tend to be lower and prices are linked to the number of users. Up until now, HipChat, which offers a chat and messaging product aimed at corporate teams, has been a cloud-only product.

But some companies working on sensitive projects or in industries or countries with tighter regulatory environments need to keep their information close at hand. They may be government agencies, financial service companies or health care companies.

In an interview with Re/code, Bernardo de Albergaria, Atlassian’s VP for collaboration products, promised there would be no feature difference between the cloud version and the server-based version. “We’ve made sure we’ve built a product that will satisfy both the cloud crowd and server crowd,” he said. The one difference is higher pricing. Typically, a company can start using HipChat for free and then upgrade to paid tiers later. The server version starts at $10 per user per year for the first 10 users.

More than 4,000 companies signed up to test the server version of HipChat, he said. That works out to about 10 percent of the 40,000 companies that use Atlassian’s collaboration products including HipChat. Its sizable customer base — which includes Citigroup, eBay and Coca-Cola — has been built up without the benefit of a dedicated sales force. “We just let it happen,” de Albergaria said. “We’re not anti-sales. We’re more pro-automation and self-service.”

Still hinting at bigger plans to come, de Albergaria says Atlassian — which is based in Sydney but boasts a sizable office in San Francisco’s SoMa neighborhood — plans to hire 500 more people worldwide this year and to triple the number of employees devoted to HipChat.

Atlassian last raised $150 million in a round led by investment firm T. Rowe Price that was said to value the company at north of $3 billion, and its CEOs are starting to make tentative noises about an IPO.

But the competitive environment for corporate collaboration tools is heating up. Earlier this month, both Facebook and LinkedIn launched products aimed at connecting people in the workplace.

Another player on the chess board is Slack, the fast-growing tool headed up by Stewart Butterfield, which landed more than $160 million in venture capital investments last year.

This article originally appeared on Recode.net.